Tailor to Pay $5.5M for Tax Fraud Under New York Law, $1.1M to Relator

Posted: 03/05/2013  browse the blog archive

Mohanbi “Mohan” Ramchandani and his business Mohan’s Custom Tailors, located in Manhattan, pleaded guilty to tax evasion and agreed to pay $5.5 million in damages and penalties to settle a first of its kind prosecution for tax evasion under New York State's False Claims Act.  The guilty plea related to a ten-year scheme to evade payment of New York sales and income taxes.  The settlement stemmed from a civil claim first filed by a whistleblower.  The New York Attorney General’s investigation revealed that since at least 2002, Ramchandi and his business knowingly failed to pay at least $1.7 million in state and local sales taxes that they nevertheless charged to customers. Ramchanndi also knowingly failed to pay at least $256,000 in personal income taxes.

The whistleblower, or relator, will receive $1.1 million under the relator award provisions of New York’s False Claims Act, according to the Corporate Crime Reporter.

The Chanler Group, in association with the Hirst Law Group, represents whistleblowers who take action under the False Claims Act to report fraud committed against the federal and state governments.  We have years of experience representing whistleblower clients who uncover fraud of every kind perpetrated against our government including, health care fraud, contract fraud, and tax fraud.  Read more about our expertise in False Claims Act cases and how you can take action.